Poor, vulnerable countries at risk of being ignored in rising trade tensions: UN body

By Mucahithan Avcioglu

ISTANBUL (AA) - The poor and the vulnerable are at risk of being overlooked as major economies are set to impose sweeping new tariffs, according to a statement by the UN Conference on Trade and Development (UNCTAD) on Friday.

"In a low-growth, high-debt global economy, higher tariffs risk weakening investment and trade flows – adding uncertainty to an already fragile context," it said.

This might undermine development gains, impede investment, and erode confidence, especially in the most vulnerable economies.

Economies that bear little of the blame for global trade imbalances are subject to harsh sanctions, even if they are least able to withstand shocks.

“This hurts the vulnerable and the poor,” said UNCTAD Secretary-General Rebeca Grynspan. “Trade must not become another source of instability. It should serve development and global growth.”

"For businesses and policymakers alike, unpredictability and uncertainty in trade and investment is becoming a serious obstacle to growth and planning," the statement said.

Stating that just 10 of nearly 200 trade partners of the US account for 90% of the US' trade deficit, the statement added that least developed countries and small island developing states – responsible for just 1.6% and 0.4% of the deficit, respectively – are also being affected by the tariffs.

"Many low-income economies now face a 'perfect storm' of worsening external conditions, unsustainable debt levels, and slowing domestic growth," it said.

UNCTAD called for dialogue and negotiation by saying that trade imbalances, concentrated gains, and outdated rules must be addressed – without sacrificing those least responsible.

“This is a time for cooperation – not escalation,” Grynspan said.

“Global trade rules must evolve to reflect today’s challenges, but they must do so with predictability and development at their core, protecting the most vulnerable.”